Roku Inc (NASDAQ: ROKU) stock slightly recovers post a heavy crash

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Roku Inc (NASDAQ: ROKU) stock rose over 2.6% on November 8th, 2019 (as of 10:48:59; Source: Investing.com) after falling over 16% on November 7th, 2019 post third quarter of FY 19 update. For FY 19, the company expects full-year platform gross margins to be in the low-60s percent due to mainly by continued mix shift to video advertising. For players, the company expect player gross margin to be in the low single digits for 2019, and the company expect player gross margin to be roughly 0% in Q4.

During the third quarter, ROKU had launched the new streaming player lineup in North America, Latin America and key markets in Europe.

ROKU in the third quarter of FY 19 has reported the adjusted loss per share of 22 cents, while adjusted revenue growth of 50 percent to $260.9 million in the third quarter of FY 19,. The company has reported 32.3 million active accounts, which reflects a net addition of 1.7 million from the previous quarter. Roku has also reported a 30% year-over-year increase in average revenue per user, at $22.58. Total operating expenses for the third quarter rose about 60% to $145 million from a year ago.

Moreover, the gross profit also grew 50% to $118 million and posted the gross margin of 45.4%, similar to the prior quarter. The company’s adjusted EBITDA had roughly breakeven and the company posted the net loss of $25 million, which were ahead of the outlook due to better-than-expected revenues and lower-than-expected sales and marketing expenses due in part to timing of retail and merchandising cost, as well as head count cost primarily stock-based comp expenses. Strong platform growth continued as revenue of $179 million was up 79% year over year and Roku monetized video ad impressions once again more than doubled year over year. Player revenue had increased by 11% year over year, due to the 21% year-over-year increase in player units with ASPs down 9% year over year as the company continues the strategy of attractive player pricing in order to drive unit sales and active accounts. ROKU had ended the quarter with $388 million of cash, cash equivalents, restricted cash and short-term investments.

Additionally, In October, Roku had announced that it had spent $150 million to acquire Dataxu, which lets marketers plan and buy video ad campaigns. The deal is expected to be finalized during the fourth quarter.

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